NFIB

Leasing Your First Commercial Space, Part I
03/ 12/ 2002


Your small or home-based business has expanded rapidly, and you're looking for larger office space to lease so that you and your employees can work without tripping over each other. As you look around, you maybe surprised how many options you have for space to lease. In today's Workshop, contributor Jeff Moses offers a few tips to help you get situated.

Office space is advertised in the classified sections of most newspapers. If you're leasing three or four rooms, you may be able to find exactly what you need through the papers. But if you're in need of an executive suite for yourself and a large number of employees, you may want to consider contacting a real estate agent to work with you. They'll have listing for business leasings, and can save you time by steering you to suites that most closely fit your needs. Most of the time, you won't have to pay extra for this. The agent's commission or fee will be paid by the property owner. Realize, of course, that the agent has a vested interest in leasing you the most expensive space possible.

Experts agree that most people are tempted to lease office space that is more expensive than originally planned for in the budget. This is normal; everyone wants to make a good impression. But be cautious: it's almost always better for a new, growing business to put cost-economy first. When you outgrow your new office in the future, that may be the time to go upscale.

Remember, to get a total picture of what a new office will cost, you have to take into account not only your rent but the monthly cost of utilities, trash removal, etc. Before signing a lease, ask for records of total costs for the last six months or year to determine they fit your budget.

You should assume that anything not specifically addressed in the lease agreement will be your responsibility: janitorial service charges, trash removal charges, etc. Many property owners expect to negotiate what is included in their lease package, so don't be afraid to ask for inclusion of some services.

Try to focus on office space that is fairly near your home. Why put yourself into the situation of having a commute when you don't have to? Location should be just as important as price, office layout, and square footage.

When leasing, leave yourself room to grow. Don't lease a small space in an expensive area of the city. It may be too small for your future needs. Instead, lease something in a somewhat less expensive area but with the square footage that allows your company room to expand as you take on more employees.

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